Xelloss on 26 January 2010
I do not think Sony is in a financial position to launch a new console for at least 2 years, most likely 3. Launching a new console traditionally means taking a huge loss per unit for the first couple of years at a minimum... Sony needs to recoup at least some PS3 losses first. Only after a couple of years of overall profitability will Sony be in a strong position to think about a new console, and they also have to put in the time effort and $$ next time around to make sure that the dev kit is fully fleshed out and ample middleware is in place, so developers feel comfortable making the plunge to a new platform. Or else it will be PS3 all over again.
On the MS side, right now MS is caught in something of an awkward position. The 360 platform is, to the best of my knowledge, making a profit. Thus, they are in no hurry to advance. They are betting on Natal to at least provide "political cover" for not launching a new console for the time being, IMO it really will play out as more of an excuse to analysts and investors than anything. "Why not new console - why Natal of course!" I do not think Natal will make huge waves on 360, I think it will not be until the next gen that it really gains software and traction, however there is absolutly no reason for Natal to not be forward-compatable with MS next platform offering. After a very lukewarm 2010 launch, look forward to MS promising big things for Natal owners when the "720" hits, and expanded Natal launch offerings and even bundles similar to Wii Sports.
So why the delay? Well, it is likely a matter of format as much as anything. MS knows that doing DVD again for next-gen is a non-starter, it works well enough for now, but trying to go into the next gen with DVD would cause most devs and publishers to roll their eyes and financial analysts to openly wonder what MS was thinking. Going blu-ray would amount to a loss of face, and paying of royalties to Sony albiet indirectly via the blu-ray consortium which includes many other industry figures... most of whom are at odds with MS in various arenas.
HD-DVD is dead as a general entertainment media, but MS could still use the platform for gaming, likely at preferred royalty rates and though this move seems logical at first glance, many people will openly question the wisdom of using a "dead" platform. After all, to many reasonable people it will seem like petty spite, even though it would actually make sound business sense. But it is certainly better for MS to be able to claim they are using whichever medium they choose next because of its features, not because its simply cheap and they did not want to go with the competition.
So where does that leave us?
I think the most likely scenario is a return to..... yeah, you guessed it - cartridges. Or rather, solid state storage. This medium has many theoretical advantages, including drastically lower Bill of MAterials for the actual gaming system since it will require no HD-disc drive , better reliability since USB/ROM ports are typically more reliable than optical drives, less heat, faster data access to name a few.
So what are they waiting for? Likely the price to come down. If they were to attempt such a move at the moment, even at MS huge buying capacity for volume rates - games would still cost 80$ at retail. A flash drive with the reliability and size required to be a valid contender still costs considerably more than a DVD or even blu-ray. Pricing increases sharply past 8GB, and they assuredly want a system capable of competing with Blu-Ray storage at a reasonable price. They know what charging Publishers 20$ or even 40$ for a cartrige/ROM would do, they saw it with N64.
Time is on their side though, prices are falling and will continue to do so. I anticipate the pricing to be in the sweet spot within 2 years, and MS to launch a new console around that time. After NAtals coming lukewarm reception, scrutiny will shift from Natal to 720 and MS will start prepping accordingly.
Prediction: MS launches new console end of 2011/early 2012 with Sony lagging behind until late 2012/early to mid 2013. New console will feature some form of solid state cartridge for storage. MS will get another head start, the question will be how well Sony manages their marketing during this time, how good their then-current games are and if they can seamlessly transition dev houses this time around for a stronger slate of launch titles. If they cant, they will be in trouble.
